Automakers around the globe are planning to embark on substantial electrification programs. As a result, a number of partnerships, alliances, tie-ups, and agreements have taken place recently between companies that were once (and probably still are) rivals, aimed at reducing costs so each company can proceed with EV development without going bankrupt. It seems every company is taking a somewhat different approach to electrification, and no one is really sure which path is the best way forward. But General Motors and Honda feel that their approach, which will involve joint EV development and platform sharing, is what’s best for them.
GM and Honda have a history of sharing technology that goes back almost twenty years. In 2004, shoppers could opt for the Honda 3.5 liter V6 and five speed automatic transmission in the Vue. And GM cooperated with Toyota on small cars with NUUMI between 1984 and 2010. The American automaker seemingly learned nothing from either of those endeavors. This time, things may be different. Tesla, despite being a much smaller company, is leading the industry when it comes to nearly all aspects of EV technology. Everyone is playing catch up at this point. But most non-luxury automakers aren’t solely racing to reach parity with Tesla – they’re also going to have to face competitors who have launched or will soon introduce their own battery-powered vehicles.
To that end, GM previously announced that they’ve begun their own EV program centered around a proprietary battery family, entitled Ultium. These batteries, which are currently being developed with LG Chem, promise large capacities and substantially reduced costs when compared to current prices. GM revealed that their Ultium batteries will initially boast a capacity range that starts at 50 kWh to 200 kWh. That last number is perhaps the most intriguing figure, as Tesla presently offers a maximum 100 kWh battery in the Model S and X. Rivian, which will introduce two utility EV models in 2021, will offer a 180 kWh battery as the range-topping powertrain in both vehicles.
Perhaps more importantly, GM is claiming a cost breakthrough when it comes to battery manufacturing. They’re claiming that the future LG Chem-supplied batteries will cost below $100 per kWh. That price point, if it holds true, would represent a substantial reduction with contemporary battery pricing, which in 2019 sat at around $156 per kWh. A sharp reduction (approximately 70 percent) in the use of cobalt is likely a key part of why that figure is so low.
Honda’s involvement with GM’s Ultium batteries isn’t anything new. The company announced they’d use the batteries in April. Basically, two future Honda EV models will not only incorporate Ultium batteries, they’ll also be available with OnStar and Super Cruise. They’re slated for a 2024 model year release, which means we’ll potentially see them in 2023. They’ll also be manufactured in America by GM and use GM’s upcoming global EV platform. Per AutoBlog, Honda will be responsible for developing the interior, exterior, and driving dynamics of the two EVs.
This is a bit of an about face for the Japanese automaker, who as recently as last year seemingly suggested that more substantial EV offerings were slightly farther off. Honda also killed the fully electric variant of the Clarity earlier in 2020 and will not bring the E small car to America. Presumably, the company feels that they don’t need any EVs until these new models arrive later in the decade.
Today’s announcement is a non-binding alliance centered on a strategic tie-up in North America. Building on the Ultium-related technology sharing initiative, both companies will collaborate on new vehicle platforms, electric and internal combustion powertrains, and other areas like infotainment, connectivity, and driver assistance systems. Naturally, it’s tempting to speculate how this new partnership will play out. Will this allow GM to stay in the mid-size game with an Accord-based Malibu? Will the next generation NSX and Corvette share some DNA with each other? Will we see General Motors employ Honda’s hybrid technology in vehicles like the Equinox and Traverse?
Regardless of what future products are derived from the joint effort, it’s incredibly advantageous for both companies to team up. Honda could help GM strengthen its front-wheel drive based offerings while GM will no doubt help the smaller Japanese automaker reduce costs. Honda probably won’t add any GM trucks to its lineup, but freeing up development costs for its rear-wheel based platforms might allow GM to continue building Cadillac sedans and the Chevy Camaro, as of this writing is rumored to meet its end by 2030.
Speculation aside, both automakers have lots of work to do. As previously mentioned, Honda didn’t really commit to EVs until this year. GM is also talking a big game with the upcoming Hummer “revival” and some EV concepts like the Cadillac Lyriq. But the Bolt hasn’t exactly lit the world on fire. They haven’t introduced any unambiguously successful EV in America thus far. And previous attempts at alternative-energy powered vehicles have failed. Remember the Volt? Or the Malibu hybrid?
Additionally, Ford seems to be a bit farther ahead than GM in terms of introducing a fully electric pickup. Plus, their continued push into hybrid technology might possibly pay off handsomely when the 2021 F-150 hybrid is introduced in a few short months. And that’s to say nothing of the Mustang Mach-E, which just might be the closest Tesla competitor yet, although final range figures have yet to be announced.
And of course there’s Tesla, which recently hinted at increased battery capacity. Hyundai is also going full steam ahead on their electric vehicles too. It’s starting to look something like the Wild West in the automotive industry right now, at least in regards to EV development, and pretty soon everyone is going to be pointing six shooters at each other, figuratively speaking. That is, of course, assuming shoppers even start buying EVs en masse, which is by no means guaranteed to happen. That being said, the General Motors/Honda alliance is a prudent course of action. And whatever the outcome, it seems that the fates of both companies are seemingly inextricably linked from this point forward.
Future. Future. Future.
I, for one, will be happy to find Chevrolet dealers willingly selling Bolts right now.
For which reason, I’m taking these claims with a huge grain (no, make that block, bordering on semi-load) of salt.
I agree the dealers are the weak link and we don’t need more vaporware. But maybe because I’m in the Portland area my local dealer was more that happy to sell me a Bolt, and years earlier a Spark EV. And the salespeople were knowledgeable about the product both times. Maybe they should be teaching other dealers.
The 200 kwh battery pack is obviously slated for the Hummer.
Back in 1973, Honda built a CVCC version of the Chevy 350 V8 to prove that it could meet emission regs without catalytic converters.
Honda needs a development partner in the US, as so many of their larger vehicles are US specific and not relevant in Japan and Europe.
As to GM getting a version of the Accord or such, I suppose it’s possible, but I wouldn’t hold my breath. It’s a dying market and we saw how well it worked (not) when GM was selling Corollas as Prizms.
Damn, I forgot to include Honda’s 350 V8 stunt.
I don’t really think an Accord based Malibu will happen either, I just included it as I believe all auto writers are legally obligated to irresponsibly speculate when announcements like these are made. In reality, this alliance will probably help Honda reduce costs for their sprawling crossover lineup, like you suggested.
I guess between a rock and an hard place, Honda preferred GM to Nissan. Honda dodged a bullet last year when the Japanese government wanted to force a merger between Honda and Nissan. https://www.thetruthaboutcars.com/2020/08/report-nissan-honda-tie-up-didnt-makes-it-to-the-first-date/
Has things at Honda become so dire that they felt the need to tie itself to the likes of GM? Honda does have the weakest truck and CUV line up of all the Japanese automakers with the possible exception of Mazda. For example they are trying to compete against the Tundra and Tacoma with the minivan based Ridgeline, which is obviously not selling anywhere near Toyota volume or margins. GM will give them quick and easy access to trucks and CUVs, but at what cost?
It’s difficult for these companies like Honda and GM. They’ve got such a massive amount of capital tied up in machinery for producing ICE cars, which is likely to be made obsolete long before the costs have been amortized. Then there’s the electric vehicle start-ups which are having money thrown at them and have no legacy pension obligations and can build optimised factories from scratch. Then there’s China who reckon they can skip ICE development and go straight to electric and are pushing it like crazy with all kinds of incentives and a huge home market. Europe is going electric in a big way. Then there’s Tesla with that huge stock market valuation.
And besides giving us cleaner air, charging all these electric vehicles at night helps with the load balancing of the grid, a serious concern in places like California.
https://www.autocar.co.uk/car-news/new-cars/new-electric-cars-2020-2021
All this makes me think of when electric heat was the clean, efficient home heating system of the future, especially here in Canada. Electric furnaces, baseboard heaters were the only way to fly.
Till everyone had it and the cost skyrocketed. My first house had a newish electric furnace. I thought it was great til winter and the heating bills started. Then a later house also had an electric furnace. It got yanked as soon as I could and gas installed. What was saved in hydro paid the gas bill and pretty much the furnace.
When electric cars become commonplace in both availability AND cost, we’ll talk. Til then this dinosaur will stick with his dino powered past.
“And whatever the outcome, it seems that the fates of both companies are seemingly inextricably linked from this point forward.”
I think it is still way to early to say this. It is a non-binding MOU. In other words they haven’t worked out any details and either party can walk away if they don’t reach a mutually acceptable agreement.
Ten years ago Honda was making the best cars in the world. My how things can turn on a dime.
The Americans thought they were superior to the Japanese and completely disrespected and disregarded them. The Japanese have now repeated this mistake in their attitudes towards the Koreans and Chinese. Hubris it seems is international. Just like to add that we Brits did it first…
I have owned more Honda’s and GMs than anything else. Not sure how I feel about this.
Everyone seems to be jumping on the electric bandwagon these days. That’s fine, but electric cars are going to have to come a long way to beat the good ole internal combustion engine. Powering electric cars will be expensive and the environmental savings won’t be that great because it takes any number of fossil fuels to generate all that electricity.
There IS solar and wind. Any number of homes in my town generate enough solar energy to provide all the household power as well as charge an electric car (or two). Even if not, I’ve already demonstrated in the electric Mini Cooper review that it would be less expensive to pay the current going rate for electricity from my utility than to pay for gasoline. Not seeing the downside, sorry, especially as we are (and never will be) a single-car household. Just like I wouldn’t regularly take an electric Mini Cooper on a cross country drive, I also wouldn’t regularly take an F350 Dually to my narrow-streeted Old Town area. It doesn’t take a lot of research to actually learn the truth, but it does take a willingness to have an open mind.
I don’t mind some other people using electric cars, but I don’t look forward to the day when electric takes over gasoline engines and we don’t have a choice to drive gasoline if we wish. Also, I won’t ever put those awful looking solar panels on my roof. Don’t care how good they may work, to me aesthetically they look terrible and the appearance of my home is important to me. Call it silly, but that’s just how I feel.
Well, that’s a different argument then as opposed to an economic one, it goes to your personal preference, likely there were some people that kept on riding horses too, nothing wrong with that. Gasoline vehicles will likely not go away for many, many years, if ever.
They make solar “shingles” now in several formats, the solar collectors don’t have to look like the solar panels you are likely thinking of. Some of these lay flat on the roof and some literally ARE the roof and look like individual shingles. As technology improves more, these will likely become more and more common and cost competitive as well.
If solar roof panels do become available that look like roofing shingles and are cost competitive, I might would consider them. But I’m guessing that will be a few years from now.
In Oklahoma last month, I saw a horse and buggy patiently waiting to cross Hwy. 412 east of Tulsa, which was a divided 4 lane road.
Even on the motorcycle front, Honda appears to be struggling, though I admit I say that more from perception than hard facts. In the parts of the world where motorized two wheel transport is still ubiquitous, Chinese and Indian brands dominate. In the US market, the European brands lead the high margin adventure, sport and high-end dirt bike markets. And in World Superbike and MotoGP road racing, with the one exception of a certain Marc Marquez, the bikes are not competitive and team management seems adrift. Nevertheless, I see this partnership as potentially more beneficial to GM than Honda.
I would only consider Yamaha or Honda for my next bike. I’ve found that both Kawasaki and Suzuki can be troublesome, with irritating faults like stretching camshaft chains (S40) and leaking water pumps (Ninja 250).
Thank you for the continued updates on current state of anomalous industry affairs. The auto worlds odd-couple if you will. I can only determine the most obvious. Both lost considerable sums after their electric debutants sales short circuited big time. Honda’s small car cred and long-term approach coupled with GM’s fashion forward and large vehicle cred compliment each other quite well. If this partnership proves fruitfull they will make one hell of a tag team (Road Warriors II) to reckon with. This article shifted my brain into infinite regress mode that I can’t get out of.
It’s interesting to me to see the reaction to this announcement. From these reactions, one would think that Honda offered to merge with GM and start building brodozers. See the attached picture. It ain’t happening.
At least in North America, I don’t see sedans coming back with any significance. There will be no re-badged Accords or Civics masquerading as any kind of Chevy or Buick. There will be no repeat of the motors and trans that the Saturn Vue was saddled with. It’s a non-binding agreement, it has all the sticking power of a Post-It note to force either party to do something they’re not interested in doing.
Honda and the other Japanese manufacturers are far behind in their BEV efforts. Whether they collectively thought that hydrogen is the solution or the hybrid systems would have a lot longer life, the lucrative Chinese market has made the decision for them. Honda’s own hybrid cars have a history of being less than spectacular, so it’s not like they have Toyota’s Synergy Drive system’s sterling reputation to fall back upon.
Honda needs a battery solution and apparently GM has it.
Actually, Rob Lemon’s post said it best. ALL of the legacy car makers are up against ridiculous conditions, i.e., money being thrown at new electric car makers pumping up their valuations and existing car makers are saddled with high overhead and legacy costs. It’s not a level playing field, but who said it was going to be?
Thank you for your kind comment geozinger.
I think probably the changes in photography are a good example. Where are Kodak now? The move to a digital world scuppered many a company which didn’t move quickly enough.
We do seem to be loosing all the individuality in cars. Platform sharing is becoming ubiquitous, and electric cars seem to be pushing it further. When the only difference between a GM and Honda is the trim and badges it’s a sad day. It’s like a universal VAG or GM in the bad old days.
My main problem with it is that it’ll all become disposable, part of the throwaway culture.
I think it was perhaps growing up in the tail end of a ‘make do and mend’ culture that makes me rebel against it. I like vehicles that can be kept going, a pre fuel injection Harley, an old Merc, that kind of thing.
I can’t tell if the Kodak reference was intentional or not but amazingly it was Kodak itself that actually invented the digital camera. And then somehow stuck it in a drawer in order to keep selling rolls of film.
I’ll reply to both Rob and Jim in this comment. I’ve been amazed at the reaction to this announcement, especially by the folks who think that either GM will purchase Honda or vice versa. They’ve agreed to agree to hold discussions. There are no re-badged Honda Accords coming, nor is there going to be a Soichiro -edition Silverado. Besides, I wouldn’t really want to be a legacy automaker right now; it’s a very ugly world for them.
WRT to Kodak and the digital camera. The legend goes, they had no idea exactly how to capitalize on this invention. The other side of this is that Kodak’s reason for existence was film. You often hear words in business like “core competencies”, but when the digital camera was being invented, film was Kodak’s core competency. Similar to the US railroads not comprehending the threat from interstate trucking companies, Kodak could not imagine a market for this item.
OTOH, even if they would have gone all in on the digital camera market, would it matter now? Who doesn’t have a camera on their phone that could rival some of the better consumer grade SLRs that were available 20 years ago? Maybe this would have happened to Kodak anyway.
“At least in North America, I don’t see sedans coming back with any significance. There will be no re-badged Accords or Civics masquerading as any kind of Chevy or Buick”.
Too bad, it could had been fun to see photoshopped Accord turned into a Malibu or a Camaro photoshopped in a Prelude. 😉